WASHINGTON, D.C., January 12, 2022 – The World Bank (International Bank for Reconstruction and Development, IBRD, Aaa/AAA) today priced USD 1.0 billion 4.5-year and USD 2.0 billion 7-year benchmark bonds – both linked to the Secured Overnight Financing Rate (SOFR) index.
The World Bank has continued to support the development of the SOFR market with a range of SOFR-linked benchmarks across the yield curve, since the World Bank’s first SOFR-linked benchmark in 2018. The transactions meet increasingly global investor demand from a broader range of investors seeking high-quality, SOFR-linked floating rate assets. Orders of over USD 3.8 billion were placed from investors, with several investors placing orders in both tranches. Joint lead managers for the transactions are BMO Capital Markets, Scotiabank, and Wells Fargo Securities.
Jorge Familiar, Vice President & Treasurer, World Bank said: “This dual-tranche transaction highlights the growing interest we are seeing from investors from around the world for SOFR-linked, floating rate assets, with maturities across the yield curve. The firm establishment of the SOFR market is important to the health of the global financial system on which our developing country members rely.”
Europe, Middle East, Africa
By Investor Type
Central Banks/Official Institutions
Joint Lead Manager Quotes
“The World Bank continues its leadership in US dollar markets as the first Supranational, Sovereign and Agency (SSA) issuer to print a SOFR-linked Floating Rate Note (FRN) to kick-off the new year. A dual-tranche FRN enabled short and long-term focused global investors to participate, a far-reaching and inclusive audience for the World Bank’s first US dollar benchmark of the year. At $3 billion in size, we can firmly conclude that the term “USD benchmark” no longer exclusively applies to fixed-rate offerings. Kudos to the World Bank Treasury on tremendous reopening of the SSA FRN markets,” said Sean Hayes, Head of US Syndicate & Credit Sales, BMO Capital Markets.
“Scotiabank is proud to support the World Bank’s dual tranche SOFR-linked Sustainable Development Bond transaction, its first USD-denominated transaction of 2022. This new issue demonstrates the World Bank focus on the development of the SOFR market. Furthermore, the benchmark size of each of the two tranches highlights the wide appeal of the World Bank name to investors across the maturity spectrum. The issue, which supports the financing of a combination of green and social projects, programs, and activities in IBRD member countries, highlights the World Bank’s position as a market leader in sustainable finance,” said Cesare Roselli, Global Head of SSA (Sovereign, Supranational, and Agency) Origination, Scotiabank.
“The World Bank’s first US dollar benchmark transaction of the year is a success in many fronts: IBRD garnered substantial demand to price a sizable USD 3 billion transaction in two-tranches, including an admirable USD 2 billion longer dated 7-year tranche--the second time IBRD achieves that feat. The World Bank did all of this while maintaining its status as the prime SSA SOFR-linked floating rate note issuer while expanding this product’s investor base further across the globe. Congratulations again to the WB team!” said Carlos Perezgrovas, Head of SSA Origination, Wells Fargo Securities.
International Bank for Reconstruction and Development
Aaa / AAA (Moody’s/S&P)
January 20, 2022
January 24, 2022
June 15, 2026
January 24, 2029
Compounded SOFR + 18 basis points
Compounded SOFR + 30 basis points
Calculated on the basis of the evolution of the value of the SOFR Index from the SOFR IndexStart value date to, but excluding, the SOFR IndexEnd value date with regard to the relevant interest period
Coupon payment dates:
Quarterly on the 15th of each March, June, September and December commencing with a short first coupon on 15th of March 2022, and ending on the Maturity Date
Quarterly on the 24th of each January, April, July and October commencing on 24th of April 2022, and ending on the Maturity Date
Fedwire, Euroclear, Clearstream
Luxembourg Stock Exchange
Joint lead managers:
BMO Capital Markets, Scotiabank, Wells Fargo Securities, LLC
About the World Bank
The World Bank (International Bank for Reconstruction and Development, IBRD), rated Aaa/AAA (Moody’s/S&P), is an international organization. Created in 1944, it is the original member of the World Bank Group and operates as a global development cooperative owned by 189 nations. The World Bank provides loans, guarantees, risk management products, and advisory services to middle-income and other creditworthy countries to support the Sustainable Development Goals and to end extreme poverty and promote shared prosperity. It also provides leadership to coordinate regional and global responses to development challenges. The World Bank has been issuing sustainable development bonds in the international capital markets for over 70 years to fund programs and activities that achieve a positive impact. More information on World Bank bonds is available at www.worldbank.org/debtsecurities.
World Bank bonds support the financing of programs that further the Sustainable Development Goals (SDGs). World Bank bonds are aligned with the Sustainability Bond Guidelines published by the International Capital Market Association and as such support the financing of a combination of green and social, i.e., “sustainable development” projects, programs and activities in IBRD member countries as described in the World Bank Sustainable Development Bond Framework. The World Bank is also a member of the Executive Committee of the Green Bond, Social Bond, and Sustainability Bond Principles. A key priority for the World Bank’s capital markets’ engagement is building strategic partnerships with investors to promote the importance of private sector financing in sustainable development. The World Bank’s Sustainable Development Bond Impact Report describes how the World Bank engages with investors on the SDGs and raises awareness for specific development challenges.
This press release is not an offer for sale of securities of the International Bank for Reconstruction and Development ("IBRD"), also known in the capital markets as "World Bank". Any offering of World Bank securities will take place solely on the basis of the relevant offering documentation including, but not limited to, the prospectus, term sheet and/or final terms, as applicable, prepared by the World Bank or on behalf of the World Bank, and is subject to restrictions under the laws of several countries. World Bank securities may not be offered or sold except in compliance with all such laws. The World Bank Sustainable Development Bond Framework and the information set forth therein are not a part of, or incorporated by reference into, the offering documentation.
Net proceeds of the bonds described herein are not committed or earmarked for lending to, or financing of, any particular projects or programs, and returns on the bonds described herein are not linked to the performance of any particular project or program.
Heike Reichelt, The World Bank
+1 202 477 2880